State automatically issues tax warrants to 11-year-old who receives military benefits

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BLOOMINGTON, Ind. -- For the past eight years, the state of Indiana has been automatically issuing tax warrants for an 11-year-old girl who receives survivor's military benefits, a practice that CBS4 Problem Solvers found to be legal.

Cadance Reinsch's father, Zac, died before she was born. He was an active duty National Guardsman, preparing for a deployment to Afghanistan, when he was involved in a fatal car accident. Since then, Cadance has received military survivor's benefits.

Those benefits are subject to both federal and state taxes. Reinsch's mother, Chynna Browning, contacted CBS4 Problem Solvers because she said navigating the complicated tax issues surrounding the benefits has been difficult. Browning said that when she lived in Ohio, the benefits were not subject to state taxes, but in Indiana the taxes totaled hundreds of dollars and could not be withheld.

As Browning struggled to pay the taxes each year, a balance of back taxes began to accrue, triggering the state of Indiana to issue tax warrants. While you cannot be arrested under such warrants, you can have a lien placed on your property or your wages garnished.

The tax warrants came in Reinsch's name, even though she is a minor.

"(One) sheriff said that if he would've known that it was an 11 year old, he wouldn't have even brought (the warrant) out to me," Browning said.

To make matters worse, Browning said that she couldn't get anyone to give her a total amount of owed taxes because Reinsch is considered her own taxpayer and privacy laws sometimes prevented representatives from giving her information.

"I get normally one notice a year and then when they do it the next year, it doesn’t say, 'Okay, your whole total back taxes is this (amount),'" Browning said.

CBS4 Problem Solvers got in touch with the Indiana Department of Revenue and a tax advocate contacted Browning, giving her a full breakdown of the owed taxes, which total $3,000. The state said it was willing to settle the amount due. Browning has begun that process.

A spokesperson also confirmed that the tax warrants issued to Reinsch are legal, saying in an email, "there is no state law that would prevent a tax lien on a person that owes taxes based upon their age." The spokesperson did point out that a 2018 change to the law does qualify Reinsch for a tax deduction that was previously only granted to people over 65 receiving military survivor's benefits. That deduction will lower Reinsch's future state tax obligations.

Browning also tried to get a hold of a tax advocate with the IRS, but due to wait times she said she has yet to hear back.

In the meantime, she hoped to get the word out about this complicated tax issue and her struggles to get it figured out for her daughter.

"It’s just not fair. It’s not (fair) for her to have to be paying taxes and me to have to get a runaround," Browning said.

If you have information that could help this family, or another problem you would like us to consider, contact CBS4 Problem Solvers at 317-677-1544 or ProblemSolvers@cbs4indy.com.